ICOBS 8 Annex 1 Employers’ liability register

2Part 1 In relation to information to be included in the employers’ liability register

1.1

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A firm must:

(1)

for each policy it enters into or renews on or after 1 April 2011, include, in relation to that policy, all the information required by the form in 1.2R, in accordance with the notes;

(2)

for each policy not falling in (1) and in relation to which a claim is made on or after 1 April 2011, include, in relation to that policy, all the information required by the form in 1.2R that the firm holds, in accordance with the notes; and

(3)

in relation to (1) and (2) include the notes set out in 1.2R.1

11.1A

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A firm is not required to include information required by 1.1R(1) and (2) to the extent that it relates to the firm's potential liability as a co-insurer, other than as the lead insurer, under a co-insurance arrangement satisfying the following conditions:

(1)

the risk is covered by a single contract at an overall premium and for the same period by two or more insurers each for its own part;

(2)

one of the insurers is the lead insurer who is treated as if it were the insurer covering the whole risk;

(3)

the lead insurer fully assumes the leader’s role in co-insurance practice and in particular determines the terms and conditions of insurance and rating;

(4)

the firm has entered into and maintains with the lead insurer up-to-date written agreements identifying the policies in relation to which the firm is a co-insurer of the lead insurer and the proportions of the risk for which the co-insurer is responsible; and

(5)

the firm is satisfied that the lead insurer complies with the requirements in 1.1R(1) and (2) in relation to the co-insured policies.

11.1B

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A firm is not required to include information required by 1.1R(1) and (2) to the extent that it relates solely to the firm's potential liability under an excess policy where another insurer has principal liability for the risk, and the following conditions are satisfied:

(1)

the principal insurer's maximum liability under the primary policy covering the risk is for no less than £5,000,000 in relation to a single event;

(2)

the firm has no liability to potential claimants until those claimants have exhausted their remedies against the principal insurer; and

(3)

the firm has adequate arrangements for identifying and recording the policies in relation to which the firm provides excess cover under an excess policy.

1.1C

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A firm is not required to include the employer reference number (ERN) required by 1.1R(1) and (2) where the conditions in either 1.1CAR or 1.1CCR are met.3

31.1CA

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The conditions in this rule are that:

(1)

in accordance with ICOBS 8.4.7R(1)(a)(ii) and ICOBS 8.4.11R(2), the firm has arranged to make the information on its employers’ liability register available on the website of a tracing office that meets the conditions in ICOBS 8.4.9R;

(2)

that tracing office has effective systems in place to obtain and record accurate ERN data on its database; and

(3)

that tracing office has provided the firm with a commitment that it will use its best endeavours to obtain the ERN.

31.1CB

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(1)

Where the tracing office in 1.1CAR is using its best endeavours to obtain the ERN and asks a firm to help with obtaining it, that firm should take reasonable steps to do so in line with its obligations under Principle 2 (to conduct its business with due skill, care and diligence) and Principle 3 (to take reasonable care to organise and control its affairs responsibly and effectively).

(2)

Where a firm is in possession of or comes into possession of the ERN, the firm should provide the ERN to the tracing office in 1.1CAR as soon as reasonably practicable.

(3)

Where a firm makes information on its employers’ liability register available on its own website in accordance with ICOBS 8.4.7R(1)(a)(i) or the tracing office in 1.1CAR fails to meet any of the conditions in 1.1CAR, the rule in 1.1CCR may apply.

31.1CC

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The conditions in this rule are that:

(1)

the firm has not been able to obtain the ERN solely due to failures by parties outside the firm’s control; and

(2)

the firm has used and continues to use its best endeavours to obtain the ERN, other than refusing to provide cover to an employer solely because it has not provided the ERN.

1.1D

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(1)

To help to demonstrate that it has used its best endeavours, a firm should consider:

(a)

appointing an approved person with appropriate seniority within the firm to be responsible for agreeing and signing off the firm's approach to obtaining employee reference numbers;

(b)

establishing an appropriate framework for collecting employee reference numbers and monitoring of compliance with ICOBS 8.4.4 R. The framework should be documented and should include the following matters (this is not an exhaustive list):

(i)

collection procedures which are subject to regular reviews;

(ii)

appropriate compliance monitoring, and production and review of management information;

(iii)

regular meetings between those responsible for operational collection;

(iv)

escalation of compliance issues on a timely basis; and

(v)

appropriate use of internal and external communication to promote the importance of ERN compliance;

(c)

implementing and maintaining appropriate:

(i)

internal audit measures to ensure ERN collection procedures are being followed internally and by the firm's intermediary partners; and

(ii)

controls to ensure any issues identified through the audit process are followed up and corrected within appropriate timescales;

(d)

updating terms of business agreements to cover ERN collection.

(2)

It is the responsibility of each firm to decide what processes to use to obtain the ERN based on what is appropriate and proportionate for that firm, taking into account the volume of policies, type of business written and the distribution channels used to write that business.

1.2

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FORM

Part 2 In relation to information not required to be included

2.1

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A firm carrying out contracts of insurance, in relation to which information is not required to be included in the register under FCA rules, must, beneath the form in 1.2R, state the following, where applicable, tailored as necessary to the firm's circumstances:

“We have potential liability for policies under which UK commercial lines employers’ liability cover has been provided to employers and which commenced or were renewed before 1 April 2011 and in respect of which no claims were made on or after 1 April 2011. However, we are not required to make details of those policies available in this register under FCA rules. Enquiries may be made about these policies by individual claimants, their authorised representatives, or insurers or their insurance intermediaries, with potential claims, by contacting [insert contact details]”1

12.1A

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A firm with potential liability as a co-insurer and which satisfies the requirements of 1.1AR must tailor the statement in 2.1R to include reference to the following:

(1)

that the firm has potential liability for policies under which UK commercial lines employers’ liability cover has been provided to employers for which the firm was co-insurer, but not lead insurer, but that the firm is not required to make details of those policies available in the register under FCA rules; and

(2)

responsibility for making information available in relation to policies to which (1) applies is with the lead insurer.

12.1B

R

A firm with potential liability under an excess policy and which satisfies the requirements of 1.1BR must tailor the statement in 2.1R to include reference to the following:

(1)

that the firm has potential liability for policies under which UK commercial lines employers’ liability cover has been provided to employers for which it provides cover only in excess of that provided by another insurer (and where the principal cover is for £5m or more) but that the firm is not required to make details of those policies available in the register under FCA rules; and

(2)

responsibility for making information available in relation to the policy providing the principal cover is with the principal insurer.

2.2

G

The purpose of 2.1R, 2.1AR and 2.1BR1 is to inform users of the register that the firm may be potentially liable in relation to policies other than those on the register. However, a firm may include policies additional to those entered into, renewed, or in relation to which a claim was made, after April 2011, in the register. If it does, the statement in 2.1R, 2.1AR or 2.1BR1 may be amended as necessary to refer to the policies that are not included.